The Twitter Economy

Donald Trump is known for airing his grievances and musings on Twitter making bold, sometimes defensive statements about a series of subjects, but as president-elect his ruminations are having great impact on the U.S. stock market, investors, the job market and even global relations.

One example came after the president-elect noted that he wants to reduce drug prices in his interview with Time magazine, which named him Person of the Year. Trump was asked about the rise in biotech stocks following his electoral victory. “I’m going to bring down drug prices. I don’t like what has happened with drug prices,” he told Time.

Investors were not pleased with those comments. Shares of Pfizer fell 2.6 percent while Merck stock lost 1.9 percent that morning, The Associated Press reported.

The country’s president-elect tweets and the market rises. Markets initially reacted with shock at the Trump win, sending Dow futures plummeting 800 points at one point overnight. But given the chance to digest the road ahead, the stock market recovered, with the blue-chip index turning positive in
morning trading.

However, according to Dent Research Founder Harry Dent the U.S. stock market is in a bubble and he believes the Trump rally is setting the markets up for an epic crash. While the S&P 500 is reaching all-time highs on optimism over economic agenda, some Wall Street strategists are increasingly worried about a widely followed valuation measure that’s reached levels that preceded most of the major market crashes of the last 100 years.

Trump also tweeted out a complaint about the cost of the F-35 fighter jet. Shares of Lockheed Martin, the maker of the jet, tumbled 5.1 percent in the next morning trading. By midday, Lockheed’s stock price had mostly recovered, but as with Trump’s Twitter attack on Boeing, it was clear that the markets does not have the luxury of ignoring his social media rants. (Boeing made headlines after Trump criticized the amount of money the airplane-maker was spending on a new Air Force One on Twitter.)

Despite this attack, Boeing will donate some $1 million to inaugural events in Trump’s honor, USA Today reported.

When Trump tweeted that he would ‘fix our inner cities, and rebuild our highways, bridges, tunnels, airports, schools, hospitals putting millions of people to work as we rebuild it,’ House Minority Leader Nancy Pelosi said, “We can work together to quickly pass a robust infrastructure jobs bill,” (note she did not tweet…she said that to a New York Times reporter).

In another Tweet outburst Trump bragged about saving jobs at Carrier in Indiana slated to go to Mexico. However, hundreds of jobs are still being sent south and the company is increasing investment in automation to eliminate more American jobs in the years ahead. In regular circumstances the public wouldn’t have heard much about it except for a return Tweet from the head of the Carrier steelworkers’ union who accused Trump of lying and misleading workers about the amount of jobs that would be saved.

In addition to questioning Trump’s honesty about the deal, critics have argued that the president or a president-elect personally negotiating with companies that are moving jobs out of the U.S. is not a scalable or sustainable approach to policy.

After a gunman who cited a Hillary Clinton-related conspiracy theory entered the Comet Ping Pong pizza restaurant in Washington and fired one or more shots, reports and tweets pointed to Trump’s pick for national security adviser, retired Lt. Gen. Michael Flynn, having fomented the rumors that apparently spurred the man. While no one was injured this time, fake news tweets can have damaging results.

In a more recent Tweet Trump told the Chinese to keep the U.S. Navy drone they stole even though earlier he had tweeted we must get it back. Some politicians suggest this is a just a new way of positioning in the global world. President-elect Donald Trump is not behaving like someone who will soon become “master of the White House,” according to China’s Global Times newspaper. “He bears no sense of how to lead a superpower,” the opinion piece in the Communist party-controlled tabloid said.

The tweets may have been particularly irritating to the Beijing government given Twitter has been banned in the country since 2009. Who knows if Trump is playing a psychological card with China or is in fact just unprofessional?
Much of the country (the world) is now on edge in fear of the president-elect’s next tweet and how it might impact our safety and the economy. The markets don’t know how to respond when he does take aim at a business. And it all seems a rather childish way to begin running a country though many Trump supporters offer that it’s refreshing to hear the truth for a change. The only known factor is that when Trump tweets the world reacts.

Twitter is a social network used by millions of people and thousands more are signing up every day to send short messages to groups of friends. Every second, on average, around 6,000 tweets are tweeted on Twitter, which corresponds to over 350,000 tweets sent per minute, 500 million tweets per day and around 200 billion tweets per year.

However, Twitter is lagging a long way behind Facebook and its user base of one billion-plus. If you haven’t yet succumbed to the lure of Twitter I wouldn’t worry about it. Right now it appears to be a great way to find out what the country’s next president is thinking about.

About Author

Thanks to getting fired 20 years ago by a previous publication, Pamela Hulse Andrews became the founder and publisher of Cascade Publications Inc. which publishes both the print and online versions of Cascade Business News and Cascade Arts & Entertainment. Pamela’s diverse business background gives her a broad perspective on the arts and business community. She has championed the growth of the arts in the high desert region and played a leadership role in connecting the dots between arts and economic vitality. She writes an assortment of monthly and weekly columns on local arts, politics, business and the economy, creativity and developing entrepreneurship.

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CASCADE BUSINESS NEWS

Cascade Business News (CBN), Central Oregon's business newspaper, is local and family-owned and operated by Jeff Martin. CBN is published the first and third Wednesdays of each month. CBN is a division of Cascade Publications Inc.